What is Vacation Rental Insurance?

Travel insurance or vacation rental insurance allows your guest to get a refund when they have to cancel for a legitimate reason and allows you, the owner to still get paid for the rental even if you are unable to re-rent their time.

My first year in the Lake of the Ozarks property management business (2004) my company suffered around 40 cancellations totaling approximately $20,000.00 in lost revenue.  As a half million dollar company, that represented 4% of our income.  While that didn't affect my company that much, it did touch each of the owners who lost a reservation a little more personally.  Especially if one of those lost reservations was for a whole week.

That winter I heard about an insurance company that specialized in "Vacation Rental" insurance. As I spoke with the insurance company, they asked how we were currently processing our reservations, the penalty for cancelling and how much of a deposit was required.  At the time we were taking a deposit equal to a one night stay and the guest would pay their balance upon arrival.

The insurance company told me about their product, which was very similar to what the vacation cruise lines use where their travelers were paying up to a year in advance.  The insurance covered most unforeseen situations like a death in the family, hospitalization, severe illness, some weather related situations, etc.  They told us that we would need to require full payment at the time of their booking.  I told them that I didn't think that would work.  For the past 20 years, our guests had only been required to pay a one night deposit, how could we demand the entire payment?  They said that if the guest didn't have anything to lose, then there was nothing to keep them from cancelling.  I couldn't argue with that.  So we made a compromise.  We made the guest put down 50% at the time of the booking and then they paid the other 50% 30 days prior to their arrival.

The next year we had 4 cancellations instead of 40! Success!  Today we book over a thousand Lake of the Ozarks lodging reservations a year and have less than 10 cancellations a year.  We offer the insurance at the time the guest books and explain what the consequences are if they opt not to purchase the insurance. In addition to the guest getting a refund when they cancel for a covered reason, we get to keep the money already paid in! Our guests are happy and just as important our owners are happy as well.  If you have any questions about travel insurance, just give me a call.

Russell Burdette is the owner/broker of Your Lake Vacation, a professional vacation rental management company at the Lake of the Ozarks since 1986.  Russell has served as the vice-chairman of the Tri-County Lodging Association, is past president of the Lake of the Ozarks Vacation Rental Association, sits on the board of directors for the Lake of the Ozarks Golf Council and is currently president of the Lake Business Builders BNI chapter.  Call 573-365-3367 or email russell@yourlakevacation.com.  

For more information please call us toll free at 1-877-284-0267!!

YourLakeVacation.com
4571 Osage Beach Pkwy, Suite A
Osage Beach, MO 65065
Local - 573-365-3367
Fax - 573-365-5076  

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